New Roadmap Shows How to Cut a Surprisingly Big Source of Emissions

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(Bloomberg) — The industrial sector is the third-biggest source of carbon pollution in the US. While the need to cut emissions from steel and cement receives the most attention, a new report makes it clear that dozens of industries, from ethanol to toilet paper and breakfast cereal, share a ready-made climate solution: electrification. 

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Electrifying these overlooked sources of CO2 has the potential to cut their emissions 26% by 2050, a reduction of about 1 billion tons, below a 2023 baseline, according to an 18-month analysis conducted by researchers at the University of California at Santa Barbara. 

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“We’re shining a light on what the opportunity space looks like for near-term action,” said Eric Masanet, a UCSB professor specializing in industrial innovation and a coauthor of the new study. 

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These sectors rely on low- and medium-grade heat — that is, temperatures of up to 300C (572F) — and are responsible for about 40% of all US industrial emissions. There are emissions-reducing solutions available today for many lower-heat industries. They include swapping out natural gas for electric boilers or heat pumps, as well as improving efficiency. 

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Some states, such as New York and Washington, have power prices low enough that electrified heating may already be cost-effective. Their relatively clean power grids also ensure that switching to electricity doesn’t just replace onsite fossil-fuel use with offsite fossil-fuel power production. 

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There are also state incentive programs to help low- and medium-temperature industries clean up their operations. For instance, a 2023 Colorado law made $168 million in funding available for manufacturers to replace fossil-fuel equipment with electric alternatives. California now uses some revenue from its statewide carbon-cutting program to incentivize industrial heat programs. 

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Federal and state dollars also support work in Pennsylvania and Minnesota, said Leah Stokes, a UCSB professor of environmental politics and a coauthor of the study. 

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Senators Sheldon Whitehouse and Martin Heinrich, Democrats from Rhode Island and New Mexico respectively, have co-sponsored and supported legislation that promotes electrification in high-emissions sectors, including industrial facilities, and were set to speak on the UCSB report launch webinar Tuesday.

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Industries that spend less on energy are also well-placed to decarbonize without added costs to end users. Doubling the energy costs of milk production might result in pass-through costs of one cent, according to the report. 

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While the Trump administration has reversed many climate policies and practices of the Biden administration, one element of President Donald Trump’s signature law may help make investments less expensive. Included in the One Big Beautiful Bill Act is a measure to reduce companies’ tax burden when they invest in manufacturing infrastructure and equipment. 

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For the sectors analyzed in the report, this favorable tax treatment, called accelerated depreciation, “could have profound impacts on owners’ decisions to upgrade to clean technologies,” the Santa Barbara team wrote.